With the majority of shoppers increasingly turning their attention to buying groceries and other items that they require online, businesses across Saudi Arabia and the GCC region need to ensure that they are providing both a reliable and seamless digital experience, experts said at the DigiPay 2020: The Future of Digital Payments Summit.
Presented by Khaleej Times, the KSA edition of the summit looked at changing customer behaviour in the Kingdom and the rise in digital payments.
“There is no business that hasn’t been impacted in one way or another by Covid-19,” said Ali Bailoun, general manager – KSA, Visa. “Our Impact Tracker revealed that consumers in KSA admitted that they are spending 45 per cent less now than they did before the pandemic. Also, they have made changes to their shopping behaviour. Consumers have taken to buying online and from business that offer contactless payments.”
Visa’s data also showed that 67 per cent of small businesses noticed a decrease in average consumer spending during Covid-19. As consumers in KSA stay away from all but essential retail, the impact of the pandemic on merchant revenues has been high, with 93 per cent of those surveyed stating revenues have been negatively impacted.
Bailoun also noted that the majority of shoppers said that they would continue to do the majority of their shopping online post the pandemic. As a result of the pandemic, more than a third of merchants in Saudi Arabia shifted to e-commerce offerings. When it comes to shopping habits, 81 per cent of consumers said that they visit physical shops only when necessary.
Visa also found that current conditions have served as a catalyst for online commerce with 38 per cent of merchants in KSA reporting that they have introduced online offerings as a direct result of the pandemic, while 57 per cent had an e-commerce presence before the pandemic. As consumers and merchants focus on safety and hygiene, the use of contactless payments has also increased during the crisis with merchants expecting a further 28 per cent growth post the pandemic.
Looking ahead, Bailoun said that there are several important trends that will play a big role in the future landscape. “We are looking at digital first, no matter what consumers are buying, so e-commerce will be on the rise. Already we have seen e-grocery startups witnessing a boom in their business and this will continue. Contactless payments have spiked, and will continue to rise. Lastly, partnerships are becoming the best way for businesses to move forward in the new normal.”
When it comes to advice for businesses that are looking to go digital and foray into e-commerce, Yahyah Pandor, chief information officer at Fine Hygienic, pointed to a fear of failure that might hold businesses back.
“Don’t be afraid to make mistakes,” he said. “Learn from them. Also, consumers today want simplicity, so make the payment system as easy as possible. Pay attention to deliveries and returns. People don’t want to wait for returns of their payment. They don’t want to wait a week or two for their money; at most they want to wait 48 hours to get their money back. Lastly, don’t delude yourself, because customers know good platforms and won’t be afraid to make the switch if they find yours lacking.”
His advice was similar to that offered by Ambareen Musa, CEO of Souqalmal.com, who pointed to an acceleration in digitisation.
“E-commerce companies need to build their trust levels, and this is done through good return policies and payment options,” she said. “When it comes to online returns, many companies make it difficult so that people will just give up and keep the product. What they don’t realise is that this really hurts in the long run; consumers tend to buy more and come back if they trust the company. People want to take more risks with a company they trust and, as a result, shopping basket sizes increase.”
Musa also encouraged online businesses to invest in data analytics and identify “triggers” in their customers. “Ask yourself, are your customers price sensitive? Are they only looking for deals? How loyal are they? Why have they abandoned their cart?”